A study by Crestmont Research lays bare the disconnect between the stock market’s performance and the performance of the economy.
As shown below, some of the best decades for U.S. economic growth were some of the worst decades for stock market performance. In turn, some of the best decades for stock market performance actually happened after economic growth slowed. Just look at the 1910’s vs. the 1920’s, or the 1970’s vs. the 1990’s.
Stock market performance is in blue, while economic performance is in purple. All data is based on nominal values for either the Dow Jones Industrial Average or GDP.